Market Analysis
GOLD
GOLD prices have recently broken below a significant support level, showing increased selling pressure. This comes as U.S.-China trade tensions begin to ease, signaling a potential shift in market dynamics. According to reports, U.S. officials have been reaching out to Beijing to discuss trade agreements. As trade tensions subside, market anxiety has reduced, leading to a weakening of bullish momentum in gold. While this shift could push gold prices lower, upcoming data releases and the Federal Reserve’s rate cut decisions may counterbalance the pressure.
Technically, the MACD shows sustained selling volume, and the RSI indicates a normalization in bearish momentum. We may see further downside, especially after breaking key structural levels. However, a retest of the lower boundary and the 200-day EMA remains a possibility before a deeper decline.
SILVER
SILVER is also under pressure, with selling momentum rising. The MACD has formed a bullish crossover despite a downturn in prices, while the RSI shows a gradual decline. This divergence suggests that while momentum favors a bearish move, price action remains uncertain. We advise caution in seeking selling opportunities as market sentiment could quickly shift with incoming news.
DXY (U.S. Dollar Index)
The U.S. Dollar is strengthening amid reduced trade tensions. Both MACD and RSI indicate solid buying momentum, suggesting that the bullish trend will likely continue. A break above the 99.919 level would confirm a broader shift towards bullish sentiment, solidifying the U.S. Dollar’s uptrend.
GBP/USD
GBP/USD is showing increasing bearish pressure, with both MACD and RSI signaling growing selling momentum. The RSI has slightly rebounded despite the price decline, indicating possible short-term relief. However, prices remain below the 200-day EMA, indicating further downside potential. A break below the next support level could strengthen the bearish trend.
AUD/USD
AUD/USD is gaining strength, following positive economic data. The CPI came in at 0.9% q/q and 2.5% y/y, with the Trimmed Mean CPI q/q increasing by 0.7%. These results reflect a healthy economy, reducing the likelihood of a rate cut in May. As a result, the Aussie Dollar is experiencing upward momentum, supported by renewed domestic confidence.
NZD/USD
NZD/USD is under renewed selling pressure after breaking through key support levels. Although the price rebound was partly fueled by easing trade tensions, New Zealand’s domestic fundamentals remain weak. Markets are now pricing in a 25bps rate cut in the upcoming Reserve Bank of New Zealand meeting, reinforcing the bearish outlook.
EUR/USD
EUR/USD is facing increased bearish pressure, with both the MACD and RSI indicating negative momentum. A break below the consolidation zone’s lower boundary confirms the bearish shift, and we expect continued downside movement in the near term.
USD/JPY
USD/JPY is weakening against the Dollar as traders await the Bank of Japan’s rate decision. The MACD shows increasing bullish volume, and the RSI supports growing buying momentum. A continued rally is likely, particularly if the 200-day EMA is surpassed. If the key level at 143.442 is broken, it may confirm a bullish breakout.
USD/CHF
USD/CHF continues to strengthen, tracking the broader market shift. Both the MACD and RSI show bullish momentum, indicating an ongoing uptrend. However, caution is advised, as price volatility could increase due to global events.
USD/CAD
USD/CAD is experiencing heightened bearish momentum. The MACD indicates strengthening downside pressure, and the RSI confirms increased selling. With prices rejected at the 200-day EMA, a further downside movement is expected.
COT Reports Analysis
- AUD – WEAK (5/5)
- GBP – STRONG (5/5)
- CAD – STRONG (1/5)
- EUR – WEAK (1/5)
- JPY – STRONG (5/5)
- CHF – WEAK (2/5)
- USD – MIXED
- NZD – STRONG (1/5)
- GOLD – STRONG (2/5)
- SILVER – STRONG (3/5)
Final Thoughts
The forex market is navigating through significant shifts driven by geopolitical factors and economic indicators. Both GOLD and SILVER are under pressure, with technical indicators showing continued weakness. Meanwhile, currencies like GBP/USD and NZD/USD are facing bearish trends, while the U.S. Dollar remains strong, signaling a broader bullish momentum. It’s essential to stay updated on ongoing developments, especially trade talks and central bank decisions, as these will impact market sentiment. Adapt your trading strategies accordingly to manage the market’s volatility.